Hey BlueFalcon!
Refer to the post pinned at the top of this board for more infomation.
Player Level is equal to the sum of your Hero Levels, so your Player Level will always move up when you level a Hero. Since Heroes 2.0, when Loot Chests and Progression was added, this has only awarded one Loot Chest, the rarity of which was determined by the Player Level you achieved. The systems on live are functioning the same as they have when they were first created, however, the popup is displaying the wrong number, creating confusion.
Since this is covered by the pinned post on this board, I’m going to close this thread out.
Thanks!
Huginncord